HONG KONG, May 28 (Reuters) - China’s state-owned insurer PICC Group has mandated a record number of banks to manage a planned $6 billion dual listing in Hong Kong and Shanghai, underscoring the difficulty issuers are facing to drum up demand for new listings.

People’s Insurance Company of China Group (PICC) will join a slew of Chinese banks and insurers raising funds to boost their balance sheets and meet regulatory requirements over capital adequacy ratios.

The year has been marked by a slump in stock issuance as investors fled equity markets because of increased volatility caused by Europe’s debt troubles.

PICC, one of the nation’s largest insurers, added 14 more banks including Goldman Sachs, Morgan Stanley and UBS to help underwrite the Hong Kong tranche of the IPO, that could raise up to $3 billion, Thomson Reuters publication IFR reported on Monday, citing three sources with knowledge of the plans.

The group joined China International Capital Corp (CICC), Credit Suisse and HSBC, which had already won mandates as sponsors of the deal.

The role of the 14 newly added banks would depend on the orders they bring to the IPO, indicating the growing pressure securities firms in Asia are facing in clinching a place in large offers. However, not everyone agrees that adding more banks solves the problem.

“They think that by adding more banks it will increase the chances of success. I think it potentially complicates the whole process,” said an ECM banker familiar with the transaction.

Though the roles of the banks are not yet determined, if all of them act as bookrunners, the 17 firms on the deal would set a record for number of underwriters working on a deal.

The previous record of 12 bookrunners was set by Indonesian real estate company PT Metropolitan Land Tbk for its $53 million IPO last year, according to Thomson Reuters data.

Five other IPOs had 11 bookrunners, including the blockbuster $20.5 billion IPO by AIA Group in 2010 and the $575 million IPO by JSW Energy in India in 2009.

IPO MARKET SLUMP

IPOs had their worst start in about four years in the Asia-Pacific region in 2012, with overall equity market activity down about a fifth from 2011 as investors fretted at falling markets. Volumes for initial offerings in Hong Kong plunged about 82 percent through early May from same time last year.

MSCI’s index for Asia ex-Japan has fallen about 11.5 percent since the beginning of May and Hong Kong’s benchmark Hang Seng index is down 11.3 percent.

In an unusual move, PICC will seek to complete the Hong Kong portion of the deal ahead of the Shanghai offering, to gain more flexibility in pricing the IPO, IFR added.

Most of the large dual listings in Hong Kong and Shanghai are marketed and priced simultaneously, as happened recently in deals from New China Life Insurance in December.

PICC, the parent of China’s largest property insurer PICC Property & Casualty Co, plans to seek approval from the Hong Kong exchange for the deal on June 21, though the date could change, IFR said.